Bad economy has hit most workers in the pocketbook

Wednesday

Jun 30, 2010 at 12:01 AMJun 30, 2010 at 4:41 PM

The economic downturn has hit 55 percent of workers, with layoffs, pay cuts or reduced hours. That number, part of a new study from the Pew Research Center, shows the length and depth of the worst recession since the Great Depression. Even with recent signs that the job market is improving, a full recovery remains a distant goal. The Pew center found that Americans have reduced their income expectations and scaled back their use of credit.

The economic downturn has hit 55 percent of workers, with layoffs, pay cuts or reduced hours.

That number, part of a new study from the Pew Research Center, demonstrates the length and depth of the worst recession since the Great Depression. Even with recent signs that the job market is improving, a full recovery remains a distant goal.

The Pew center found that Americans have reduced their income expectations and scaled back their use of credit.

Optimism is a precious commodity, one that that is most common among blacks, the young and Democrats, the study found. The most pessimistic groups are people older than 65,whites and Republicans.

"There seem to be some sparks in the market, but not to the extent that were willing to take the risks we would have made a decade ago." said Ann Paulins, chairwoman of the human and consumer science department at Ohio University.

She doesn't doubt that 55 percent of Americans have been personally affected. The number would be even higher if it included people who have changed their lifestyle because a close friend or relative is unemployed or because they are unable to sell a house, she said.

"We are such an interconnected system," she said.

Among people who are employed, 28 percent have had hours reduced, 23 percent have had a pay cut, 12 percent have been forced to take unpaid leave and 11 percent could only find part-time work, the study said.

A typical unemployed worker has been out of work for nearly six months, or 23.2 weeks. This is the highest since the Depression, and almost double next-highest level, which was 12.3 weeks in 1982-83.

Perhaps because of persistent unemployment, 54 percent of respondents said the recession is ongoing. Many economists would disagree, pointing to evidence that the gross domestic product is growing.